The “death spiral” phrase and the 11 highlighted states — Alabama, California, Hawaii, Illinois, Kentucky, Maine, Mississippi, New Mexico, New York, Ohio and South Carolina — appear in a Nov. 25, 2012, Forbes column, and the map appears onscreen during a Nov. 29 Fox Business “Varney and Co.” report on the commentary piece.

But the criteria used to identify Forbes’ “death spiral” states were not as simple as welfare and employment.

Forbes investment strategies editor Bill Baldwin wrote that those 11 states were “at high risk of a fiscal tailspin” because they had many people who received money from the government but maintained policies that “chase out the private-sector jobs that support all that spending.”

Baldwin reached his conclusion by comparing “makers” and “takers.” For this purpose, he wrote, “a taker is someone who draws money from the government, as an employee, pensioner or welfare recipient. A maker is someone gainfully employed in the private sector.” Then he factored in an index that downgrades states for “large debts, an uncompetitive business climate, weak home prices and bad trends in employment.”

The results, he said, showed states that were “danger spots for investors.”

We’re not sold on designating government workers or pensioners as takers. Regardless, we wondered: Was there any way the email’s claim could be true?

6 Comments

you should see the lins at the checkout at the stores on the 1st of the month,,,and alot of people buy junk and makes you wonder if they realy need it,,,in the state of vermont thay will buy you a car to drive it back in,,,,,,,lol

we moved out of CA in 1998 to get away from the business oppressive environment.
For a little 1800 sq foot home, $4000 in property taxes. 11% income taxes, 75 min each way to work and back, massive crowds on weekends, terrible people all upset all the time. Home Owner Associations run by Pschopathic Lawyers, etc. Endless drugs in schools, too many gang problems.

You forgot to mention Alaska as being among the states with the most people on the welfare rolls. 3 out of ten people in Alaska are receiving some form of public assistance. When I drive past the department of social services on the Palmer Wasilla Hyway the parking lot is full of cars.

The U.S. government needs major reforms. 1-Repeal NAFA and GATT. Charge tarrifs on imports. Lower taxes on corporations that produce their goods in the U.S. and raise taxes on corporations that outsource their manufacturing off shore.